§11-15B-17. Direct mail sourcing.
(a) Notwithstanding section fifteen of this article, the
following provisions apply to sales of "advertising and promotional
direct mail:"

(1) A purchaser of "advertising and promotional direct mail"
may provide the seller with either:

(A) A direct pay permit;

(B) An agreement certificate of exemption claiming "direct
mail" (or other written statement approved, authorized or accepted
by the state); or

(C) Information showing the jurisdictions to which the
"advertising and promotional direct mail" is to be delivered to
recipients.

(2) If the purchaser provides the permit, certificate or
statement referred to in paragraph (A) or (B) of subdivision (1) of
this subsection, the seller, in the absence of bad faith, is
relieved of all obligations to collect, pay, or remit any tax on
any transaction involving "advertising and promotional direct mail"
to which the permit, certificate or statement applies. The
purchaser shall source the sale to the jurisdictions to which the
"advertising and promotional direct mail" is to be delivered to the
recipients and shall report and pay any applicable tax due.

(3) If the purchaser provides the seller information showing
the jurisdictions to which the "advertising and promotional direct
mail" is to be delivered to recipients, the seller shall source the sale to the jurisdictions to which the "advertising and promotional
direct mail" is to be delivered and shall collect and remit the
applicable tax. In the absence of bad faith, the seller is
relieved of any further obligation to collect any additional tax on
the sale of "advertising and promotional direct mail" where the
seller has sourced the sale according to the delivery information
provided by the purchaser.

(4) If the purchaser does not provide the seller with any of
the items listed in paragraphs (A), (B) or (C) of subdivision (1)
of this subsection, the sale shall be sourced according to
subdivision (5) of subsection (a) of section fifteen of this
article.

(b) Notwithstanding section fifteen of this article, the
following provisions apply to sales of "other direct mail."

(1) Except as otherwise provided in this subdivision, sales of
"other direct mail" are sourced in accordance with subdivision (3)
of subsection (a) of section fifteen of this article.

(2) A purchaser of "other direct mail" may provide the seller
with either:

(A) A direct pay permit; or

(B) An Agreement certificate of exemption claiming "direct
mail" (or other written statement approved, authorized or accepted
by this state).

(3) If the purchaser provides the permit, certificate or
statement referred to in paragraph (A) or (B) of subdivision (2) of this subsection, the seller, in the absence of bad faith, is
relieved of all obligations to collect, pay or remit any tax on any
transaction involving "other direct mail" to which the permit,
certificate or statement apply. Notwithstanding subdivision (1)
subsection (b) of this section, the sale shall be sourced to the
jurisdictions to which the "other direct mail" is to be delivered
to the recipients and the purchaser shall report and pay applicable
tax due.

(c) For purposes of this section:

(1) "Advertising and promotional direct mail" means:

(A) Printed material that meets the definition of "direct
mail," as defined in subdivision (15), subsection (b), section two
of this article;

(B) The primary purpose of which is to attract public
attention to a product, business or organization, or to attempt to
sell, popularize or secure financial support for a product, person,
business or organization. As used in this subsection, the word
"product" means tangible personal property, a product transferred
electronically or a service.

(2) "Other direct mail" means any direct mail that is not
"advertising and promotional direct mail" regardless of whether
"advertising and promotional direct mail" is included in the same
mailing. The term includes, but is not limited to:

(C) Other nonpromotional direct mail delivered to existing or
former shareholders, customers, employees, or agents including, but
not limited to, newsletters and informational pieces.

Other direct mail does not include the development of billing
information or the provision of any data processing service that is
more than incidental.

(d) This section applies to a transaction characterized under
state law as the sale of services only if the service is an
integral part of the production and distribution of printed
material that meets the definition of "direct mail."

(e) This section does not apply to any transaction that
includes the development of billing information or the provision of
any data processing service that is more than incidental regardless
of whether "advertising and promotional direct mail" is included in
the same mailing.

(1) If a transaction is a "bundled transaction" that includes
"advertising and promotional direct mail," this section applies
only if the primary purpose of the transaction is the sale of
products or services that meet the definition of "advertising and
promotional direct mail."

(2) Nothing in this section shall limit any purchaser's:

(A) Obligation for sales or use tax to any state to which the direct mail is delivered,

(B) Right under local, state, federal or Constitutional law,
to a credit for sales or use taxes legally due and paid to other
jurisdictions, or

(C) Right to a refund of sales or use taxes overpaid to any
jurisdiction.

(f) This section applies for purposes of uniformly sourcing
"direct mail" transactions and does not impose requirements on
states regarding the taxation of products that meet the definition
of "direct mail" or to the application of sales for resale or other
exemptions.